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Grudgingly, I’ve become a fan of all the latest communication technology. I used to find it odd when people would walk down the streets of Manhattan reading email on their smartphones and ignoring the sea of living people around them, but now I blithely do the same.

And looking back, I can see how impoverished my life was before I bought my iphone. Now in those awkward moments when I stand in a crush of people eager to get off a plane or sit in a restaurant waiting for my dining companion, I nonchalantly pull out my phone and check my messages. I’m good being alone, long as I’ve got my phone.

While once I couldn’t understand why in the world my eleven year old daughter would rather text me than call, I now appreciate the wordplay and creative spelling the medium encourages. Apparently the majority of us prefer communicating through the rather more constrained channels of email and texting than over the phone. Ostensibly it’s because of the time it saves, but it also requires less engagement.

Given the economic environment, most businesses have cut back on travel and now rely on new communication technologies for meetings and even educational events. VOIP and webinar applications make such meetings virtually free. It would seem a no-brainer that it’s the way to go.

But I’ve long suspected that something essential is lost when we opt for communication mediated by technology, and apparently the cost benefit calculation is not quite as straightforward as it seems. New data suggests that much more is lost than saved. Not only does the lack of face-to-face contact lead to a decrease in performance, it also makes us a bit slower on the uptake.

A recent article in The New York Times makes a compelling case for the importance of human touch. From education to medicine to athletics, touch leads to improved results. The author of the article, Benedict Carey, thinks it may have to do with human contact releasing the hormone oxytocin. Not only does this lead to a higher level of trust, it ameliorates the negative effect of the stress hormone cortisol on brain.

When it comes to business, the implications couldn’t be any clearer. The quality of decision-making and the degree of teamwork based on trust are, in my experience, the key determinants of performance. Cutting back on face-to-face meetings may be penny wise, but it’s pound foolish.

Technology does amplify human ability. We can move about the planet faster, calculate more rapidly, and even do considerably more damage to property and one another. But the technology is developing at such a rate that it’s outpacing our species’ ability to evolve with it. For at least a quarter of million years, live human contact has been essential to enhancing the cooperation that has made us successful, and it will continue to be for generations to come.

One effect of cortisol on the brain is to narrow our vision so that we focus on the immediate threat, but cortisol also causes us to lose sight of the longer term. In tough economic times, we do have to carefully manage expenses, but we have to be just as careful that in doing so, we don’t undermine the foundation of the company we’re trying to save. Business is a human activity and the relationships that make it work must be nourished.